Sam is an educator with ten years of mentoring experience and currently specializes in employee engagement and research.
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A reference check involves a recruiter or hiring manager contacting a candidate’s references in the hiring process. Traditionally completed via time-consuming phone calls, reference checking can be stressful and awkward, but it doesn’t have to be with better tools and strategies.
The key to conducting a better reference check is creating a standardized process that you apply to every applicant.
Reference checks are the actions that recruiters or hiring managers take to physically verify the professional references listed on an employment application. In the past, these checks were done via phone calls. However, modern approaches now utilize digital tools, such as asynchronous email communication, recorded videos, and live video calls.
The answer here is a bit complicated. A reference check is required in some industries, such as education, medicine, government, and other sectors. In other industries, the requirements may be more lax. Do you absolutely have to check an applicant’s references? That may depend on a few factors.
Some industries may make conducting reference checks significantly more necessary than others. For example, the National Safety Council lists “transportation and warehousing” as the industry with the most nonfatal injuries and illnesses. To reduce Workers’ Compensation claims, you may want to check references to verify an applicant’s adherence to safety standards and policies. Even if applicants put their safety record on their resume, verifying the accuracy of this information could be an essential part of your due diligence in protecting your company from a liability standpoint.
A reference check may be necessary for applicants who have significant employment gaps, but not in the way you may think. It’s often unhelpful to conduct them for past employers if someone’s previous employer was several years in the past. However, if an applicant had a significant employment gap prior to their previous employment, you may be able to gather more information about how effectively that applicant re-engaged into a new role.
Affinity bias can make hiring on culture fit controversial, but it can be done in an equitable manner. That said, it’s always difficult to gauge whether someone’s personality fits your company culture even after an interview. Most candidates will present their best selves in an interview in a way that might not reflect their day-to-day personality when they get comfortable. Reference checks can help determine whether those individuals will be the same on day 100 as they are on day 1.
You may find many other reasons to check an applicant’s references, such as unexplained red flags, while researching their leadership potential and due to legal or compliance concerns. However, because you may spend as much as an hour talking to each reference for each candidate, it may be good to do reference checks selectively and reserve them only for situations where you feel they’re most necessary.
If you’re weighing whether you should or should not check employee references, consider the following:
Whether the pros outweigh the cons will depend on why you need to check references and how you plan to use that information. In many cases, checking references will happen on a case-by-case basis unless there are certain legal or contractual requirements that demand you to check references for every applicant.
Hiring as quickly as possible can save your company money, but making the wrong hire is also extremely expensive. Research from Northwestern University found that the average company struggling to hire experienced a 5% decline in sales and a 3% decline in profitability. That data could incentivize trying to speed up the process, but according to SHRM, the cost to hire an employee can be as much as 3 to 4 times that employee’s salary when factoring in both the hard and soft costs of hiring.
That means making a bad hiring decision is itself exceptionally expensive. Taking that into account, it makes sense that many recruiters and hiring managers insist on performing reference checks. But that doesn’t mean the process has to be as tedious as it’s often been in the past.
Here are a few tips to help you speed up the process while still getting the information you need to move forward with a hiring decision.
One of the best ways to get better and faster results out of your reference checks is to create a structured approach to the process.
Start by creating a fillable template or form that you can use for every candidate whose references you contact. That template should include spaces for standard information (applicant name, reference name, reference contact information, etc.). It should also contain checkboxes that align with the information that needs to be confirmed across all candidates and short answer boxes for discussion or feedback highlights from the references you’ve contacted.
For example, you might include the following checkbox items on the form:
Whatever you need to quickly verify with your reference communications can likely be added as a checkmark box in your template. You may want to make different versions of your template for different roles to help vary the type of information you want to receive depending on the role for which you’re hiring.
Leaving space for written feedback allows you to add additional notes in cases where you may need to add context. That said, as long as your reference checks are following a similar format, a checkbox system will get you through the verification process much faster.
Timing your reference checks can result in better and more efficient outcomes. Day of the week, time of day, and potential holidays can impact not only how quickly your references respond but their willingness to respond and the quality of those responses when you do make contact.
Consider taking the same approach that salespeople take with cold calls. In analyzing its own customer data, Close found that Wednesdays are the best days to make cold calls if you want to get a response and have more of a discussion. According to Closes’ analysis, that’s the day of the week individuals are more likely to spare time for a conversation. The company also found that between 9:30 AM to 11 AM is the best time to make calls (accounting, of course, for the reference’s time zone).
While it may seem odd to take a sales call approach, it’s important to remember that you’re calling individuals seemingly out of the blue. Those individuals aren’t always aware that they’ve been listed as a reference, and to them, your call will likely come from an unknown number.
The continued annoyance from spam calls has left most people skeptical of unknown numbers. Trying to reach individuals at the best possible time and day will yield the best results and save you time in the hiring process.
You may not always want to make voice calls. If that’s the case, emails can work well. However, emails are only as good as the content in them, and many references will fail to respond to emails without regular reminders on your part (which can also be time-consuming).
Automated reference-checking software can help make this process exceptionally simple and stress-free on your part. Reference checking software speeds up the process in several ways:
Instead of spending up to an hour speaking to each reference for each candidate, you can let the automated system do the hard work for you. This frees you up to do more important tasks and reduces the time to hire.
If you’ve created a standardized and structured format for your references, you will likely use the same questions in every engagement. There may be times when you need to vary that information, but chances are good that many of your questions will be the same for all candidates who apply and require you to check their references.
Consider using the following questions with every reference:
For legal and liability purposes, you cannot ask references the following questions:
In many countries, including the US and Canada, asking questions about these topics is considered not just taboo but illegal. In some circumstances, you may also need to avoid asking questions about a candidate’s arrest record.
Note that reference checks and background checks are not the same thing. There are two big differences between these two:
If you need to determine if someone can legally work for your organization, you need a background check. If you need to determine if someone is the right fit, you need a reference check.
As you reach out to past employers and references to determine whether a candidate fits with your desired skills, personality, and traits aligned with the role, consider other needs that may arise.
There may be times when contacting a candidate’s past employer carries legal risks.
Consent to contact
You may need to make sure you have consent from the candidate to contact their references, as well as consent from the references themselves to be contacted.
If a past employer defames the character of a candidate, this could lead to legal consequences for that past employer. If so, your company may be called to testify as a witness in a defamation lawsuit against the past employer.
Without a standardized approach to checking references, your business may run the risk of letting bias creep into the process. I nherent and implicit biases could lead to actions such as asking certain questions for some candidates and not others based on aspects of their personhood or only contacting references for some candidates and not others.
In larger organizations, with a comprehensive recruiting program, HR specialists, recruiters, or talent acquisition specialists typically perform reference checks. In a smaller organization, the hiring manager may often be responsible for completing these tasks.
Red flags can be anything inconsistent with what the candidate listed on their application, stated on their resume, or spoke about in an interview. For example, if a candidate claims to have worked on a specific project or performed a specific function, and the reference cannot confirm or declines to answer the question, this could be a significant red flag.
A backdoor reference check, sometimes called a quiet check, is when an employer reaches out to a contact that the candidate did not list as a reference or give permission for them to contact. While this may be legal, it is generally frowned upon and can harm the employer's reputation or brand.
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